INDIA'S IRDA REBUTS IMF STUDY WHICH QUESTIONED ITS INDEPENDENCE

The CEO of India's Insurance Regulatory & Development Authority (IRDA) has rejected a claim in a World Bank-International Monetary Fund (IMF) report that IRDA was insufficiently independent of government. TS Vijayan, IRDA CEO, said that "IRDA would like to assert that there is complete autonomy with regard to supervision and regulation of insurance sector in general and insurance companies and intermediaries in particular". The IMF report stated that IRDA was not completely independent as a supervising authority, given the current uncertainty surrounding its funding and its budget, and its incomplete oversight of state-controlled and market-dominating Life Insurance Corporation of India (LIC). The report further stated that the reserve powers of the central government potentially detracted from supervisors' powers and independence. The report also said that IRDA did not have modern risk-based early-warning systems in place. It noted that the sanctions which IRDA did have available tended to be at extremes, and were outdated. Mr Vijayan said that IRDA's enforcement powers were being strengthened by the proposed Insurance Laws (Amendment) Bill.